Crypto Export Restrictions Are Unconstitutional

The Federal District Court here
struck down Commerce Department export restrictions on the privacy
technology called encryption yesterday, concluding that "the
encryption regulations are an unconstitutional prior restraint in
violation of the First Amendment." For the first time, Judge Marilyn
Hall Patel ordered the government not to prosecute or harass the
plaintiff, Professor Daniel Bernstein, and those who use or publish
his encryption software. The decision knocks out a major part of the
Clinton Administration's effort to force companies to design
government surveillance into computers, telephones, and consumer
electronics.

"This is wonderful news," said Prof. Bernstein. "I hope I can get
some of my ideas published before they change the law again."

The decision is a victory for free speech, academic freedom, human
rights, and the prevention of crime. American scientists and
engineers will now be free to collaborate with others in the United
States and in foreign countries. This will enable them to build a new
generation of tools for protecting the privacy and security of our
communications.

"Once again, it took a federal court to sort out technology and the
Constitution," said Lori Fena, Executive Director of the Electronic
Frontier Foundation, which backed the suit. "Let this decision signal
the other two branches of government that when making laws pertaining
to the Internet, they must honor their oaths to uphold the
Constitution."

The decision is strategic because the Clinton Administration has been
using the export restrictions to influence domestic privacy policy.
Companies that agree to build "key recovery" technology into their
products are exempt from most of the restrictions. Key recovery, a
follow-on to the Clipper Chip, is designed to give the government
untraceable access to users' private information.

The Federal District Court of the Northern District of California
last December struck down the ITAR, a set of encryption restrictions
enforced by the State Department. A few weeks later, the Government
created virtually identical restrictions in the Commerce Department's
Bureau of Export Administration (BXA). Yesterday's decision
invalidates the new restrictions, stating, "the encryption regulations
issued by the BXA appear to be even less friendly to speech interests
than the ITAR." She warns that "the government cannot avoid the
constitutional deficiencies of its regulations by rotating oversight
of them from department to department," though concluding that she
"does not believe that such was the intent here."

"Our right to create, use, and deploy encryption come from our basic
civil rights of free speech, freedom of the press, freedom from
arbitrary search, due process of law, and privacy. Judge Patel has
affirmed those roots in the First Amendment," philosophizes John
Gilmore, Electronic Frontier Foundation co-founder. "Our Founding
Fathers used encryption -- and even invented some -- and did not
intend any ``crypto exceptions'' to the Bill of Rights."

DETAILS OF MONDAY'S DECISION

In the heart of the ruling, "The court declares that the Export
Administration Regulations . . . insofar as they apply to or require
licensing for encryption and decryption software and related devices
and technology, are in violation of the First Amendment on the grounds
of prior restraint and are, therefore, unconstitutional as discussed
above, and shall not be applied to plaintiff's publishing of such
items, including scientific papers, algorithms or computer programs."

The Court also held that the government's licensing procedure fails
to provide adequate procedural safeguards. When the Government acts
legally to suppress protected speech, it must reduce the chance of
illegal censorship by the bureacrats involved, for example by making
the government go to a judge to decide the issue. The EAR does not
require this; in fact, it precludes it. "And most important, and most
lacking, are any standards for deciding an application. The EAR
reviews applications for licenses ``on a case-by-case basis'' and
appears to impose no limits on agency discretion."

The Court dissected the export controls' exemption for printed
materials at length, calling it "so irrational and administratively
unreliable that it may well serve to only exacerbate the potential for
self-censorship." The government's "distinction between paper and
electronic publication . . . makes little or no sense and is untenable."

The Court not only declared that these regulations are invalid and
unenforceable, but also prevented the Government from "threatening,
detaining, prosecuting, discouraging, or otherwise interfering with
plaintiff or any other person described . . . above in the exercise of
their federal constitutional rights as declared in this order."

The immediate effect of this decision is that Prof. Bernstein may
publish his encryption software, and that others may read, use,
publish and review it. In addition, others in industry are studying
the court's analysis, and might decide to publish their own software
on the Internet as well.

Pretty Good Privacy, Inc, is one such company, which believes that
future courts will find Judge Patel's reasoning persuasive. "We are
particularly pleased the court has reconfirmed that computer programs,
like other literary works, are accorded full protection under the
First Amendment," said Bob Kohn, vice president and general counsel
for Pretty Good Privacy.

The final form of the judgment will be negotiated between the parties,
and presented to the court within a week. The government could either
seek an emergency appeal of the injunction, or take up to 60 days from
the entry of judgment to appeal.

ABOUT THE ATTORNEYS

Lead counsel on the case is Cindy Cohn of the San Mateo law firm of
McGlashan & Sarrail, who is offering her services pro bono. Major
additional legal assistance is being provided by Shari Steele of the
Electronic Frontier Foundation; Lee Tien of Berkeley; James Wheaton
and Elizabeth Pritzker of the First Amendment Project in Oakland; and
Robert Corn-Revere of the Washington, DC, law firm of Hogan & Hartson.

ABOUT THE ELECTRONIC FRONTIER FOUNDATION

The Electronic Frontier Foundation (EFF) is a nonprofit civil
liberties organization working in the public interest to protect
privacy, free expression, and access to online resources and
information. EFF is a primary sponsor of the Bernstein case. EFF
helped to find Bernstein pro bono counsel, is a member of the
Bernstein legal team, and helped to collect members of the academic
community and computer industry to support this case.

Full text of the lawsuit and other paperwork filed in the case is
available from EFF's online archives at:
http://www.eff.org/pub/Privacy/ITAR_export/Bernstein_case/

Scanned images of Monday's decision are available at:
http://www.eff.org/pub/Privacy/ITAR_export/Bernstein_case/
Legal/970825_decision.images/

The full text of Monday's decision will soon be available at:
http://www.eff.org/pub/Privacy/ITAR_export/Bernstein_case/
Legal/970825.decision

Professor Daniel Bernstein will be building his new Constitutionally-
protected cryptography web page at:
http://pobox.com/~djb/crypto.html